Boston, MA 10/02/2013 (wallstreetpr) – LDK Solar Company, Limited is a leading manufacturer of photovoltaic (PV) products. The company manufactures mono and multicrystalline ingots, polysilicon, solar wafers, power projects, solar cells, solar modules, solar solutions, and solar systems. The company operates in two segments, i.e. polysilicon and other PV products. In June 2012, Solar Power Inc. acquired 100% interest in Solar Green Technologies which is based in Italy, from the LDK Solar Europe Holdings which is a wholly owned subsidiary of the Company.
On Sept 26, 2013, the company announced that it has entered into a 30-day forbearance arrangement with the holders of the aggregate principal amount of its US$ settled 10% senior notes due in FY14. The forbearance arrangement which would expire on Oct 27, 2013, would relate to the interest payments due under the notes on Aug 28, 2013, which was unpaid. The company expected that the forbearance arrangement would fulfill the purpose for which it was set, i.e. achievement of a consensual solution to the company’s obligations under the notes due. As the company defaulted, so it was a part of the company’s duty to find a consensual solution to the problem faced by the investors. So the company with a positive intention appointed a financial advisor, Jefferies LLC, who will advice the company on grounds of paying their obligations.
The cash levels of the company LDK based in China, reduced by the highest percentage in the FY13 in last 4 years. Thus the company failed to make the debt payment not only in Aug 2013, but also in April 2013. The company partially failed to meet an obligation on a $24 million bond because of a temporary cash flow shortage created as a result of the inefficient operations. This also resulted in the fall of the company’s shares by 14%. But in spite of being aware of the cash shortage present, the company tried to meet up the obligations due on the bonds and intentionally took a step, through which it will be able to successfully fulfill its objective. This strategic decision, will lead to the foster company’s growth, because the incident will instill investor’s confidence.
